ISLAMABAD: Presenting the national budget in the National Assembly, Federal Finance Minister Muhammad Aurangzeb stated that Prime Minister Shehbaz Sharif’s government is fully aware of the financial difficulties faced by both public and private sector salaried individuals. He announced that, on the Prime Minister’s directives, the government has decided to provide tax relief to income-earning individuals across four distinct income slabs.
The proposed income tax reductions for the salaried class are detailed below:
| Annual Income Range | Previous Tax Rate | Proposed New Tax Rate |
| PKR 2.2 Million to PKR 3.2 Million | 23% | 20% |
| PKR 3.2 Million to PKR 4.1 Million | 30% | 25% |
| PKR 4.1 Million to PKR 5.6 Million | 35% | 29% |
| PKR 5.6 Million to PKR 7.0 Million | 35% | 32% |
In his budget speech, the Finance Minister outlined several other key fiscal measures, stating that the withholding tax on debit card usage for overseas accounts is proposed at 0.5 percent, while property tax on real estate transactions has been slashed from 5 percent to 2.5 percent, and local taxes on life-saving medicines for cancer and other fatal illnesses have been completely abolished.
Regarding corporate and high-income taxes, the super tax on annual incomes between PKR 150 million and PKR 250 million has been completely removed, whereas for incomes exceeding PKR 500 million, the super tax has been reduced from 10 percent to 8 percent.
For welfare and subsidies, the Benazir Income Support Programme budget has been increased by 17 percent to a total allocation of PKR 838 billion, alongside PKR 71 billion set aside for the “Apna Ghar” housing scheme. Azad Kashmir will receive PKR 81 billion as a tariff differential subsidy, PKR 163 billion is allocated for K-Electric, and concessionary schemes for electric vehicles, motorcycles, and rickshaws will remain intact.
Finally, provincial governments have been allocated PKR 13,350 billion, pension expenditures are set at PKR 1,169 billion, and the custom duty target has been fixed at PKR 1,651 billion. Notably, direct payments to Independent Power Producers have been discontinued for the upcoming year, and a new excise duty has been imposed on imported luxury cars and SUVs ranging from 2,000cc to 3,000cc.
